AMC plans to go public 2 years after going private

Josh FriedmanTimes Staff Writer

Coming soon to a stock market near you: AMC Entertainment Inc.

Two years after going private, the nation's second-biggest movie theater chain filed Monday to return to the stock market through an initial public offering, sending a bullish signal about a beleaguered industry.

A wave of bankruptcies followed a period of theater overbuilding in the 1990s. Since peaking in 2002, movie attendance has stagnated amid competition from home theater, video gaming and other entertainment.

"If you had tried an IPO in 2005 when the industry was slumping, people would have said, 'Are you kidding?' " said Paul Dergarabedian, president of box-office tracker Media by Numbers. "Now I think people realize last year was just part of a cycle, and the theater business is here to stay."

Kansas City, Mo.-based AMC's parent, Marquee Holdings Inc., did not disclose the number of shares or offering price that it was targeting. It said the IPO proceeds would go to a group of private investors that bought AMC in December 2004.

The offering is also contingent on the IPO of National CineMedia, which sells advertising for 13,095 screens across the U.S. AMC owns National CineMedia with Cinemark USA Inc. and Regal Entertainment Group.

Though attendance in the U.S. and Canada remains down from its recent peak in 2002, it has risen 3.6% this year -- reversing three years of declines. This summer, "Pirates of the Caribbean: Dead Man's Chest" set an opening-weekend record by grossing $135.6 million.

In its filing, AMC said moviegoing "remains an attractive value," with an average ticket price last year of $6.41.

But AMC cautioned that it had accumulated substantial debt after nine straight fiscal years of losses. In the six months ended Sept. 28, AMC lost $53.4 million, excluding one-time items, on revenue of $1.3 billion.

Still, AMC has managed to evade the most serious woes that have hit the industry.

In the mid-1990s, the company pioneered stadium seating and the "megaplex" theater, with at least a dozen screens.

In the late 1990s, AMC avoided the bankruptcy proceedings that engulfed most theater chains. The crisis helped AMC solidify its No. 2 status. In January, it doubled in size by absorbing rival Loews Cineplex Entertainment Corp., giving it 5,672 screens.